Principles Of Microeconomics Examination

6 Questions  I  By Mindstein
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 Principles Of Microeconomics Examination
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  • 1. 
    Monopolistic competition means:
    • A. 

      Many firms producing differentiated products.

    • B. 

      A situation where competition is based entirely on product differentiation.

    • C. 

      A large number of firms producing a standardized or homogeneous product.

    • D. 

      A few firms producing a standardized or homogeneous product


  • 2. 

    Refer to the above data. The value for Y is:
    • A. 

      45

    • B. 

      25

    • C. 

      30

    • D. 

      40


  • 3. 
    If the demand for bacon is relatively elastic, a 10 percent decline in the price of bacon will:
    • A. 

      Increasethe amount demanded by more than 10 percent.

    • B. 

      Decrease the amount demanded by more than 10 percent.

    • C. 

      Decrease the amount demanded by less than 10 percent.

    • D. 

      Increase the amount demanded by less than 10 percent.


  • 4. 
    Suppose a pure monopolist is charging a price of $12 and the associated marginal revenue is $9. We thus know that:
    • A. 

      Demand is inelastic at this price

    • B. 

      The firm is maximizing profits

    • C. 

      Total revenue is at a maximum

    • D. 

      Total revenue is increasing


  • 5. 

    The above diagram indicates that the marginal revenue of the sixth unit of output is:
    • A. 

      -$1

    • B. 

      $1

    • C. 

      $4

    • D. 

      $24


  • 6. 
    The MR = MC rule:
    • A. 

      Applies only to pure competition.

    • B. 

      Applies only to pure monopoly.

    • C. 

      Does not apply to pure monopoly because price exceeds marginal revenue.

    • D. 

      Applies both to pure monopoly and pure competition


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